House Republicans swat away attempt at Medicaid expansion

Some opponents argue feds can't afford it, others want flexibility

Feb. 25, 2014

Scott Munsterman

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On party lines Monday, South Dakota’s House of Representatives rejected Medicaid expansion.

The vote came as a Democratic amendment to an alternative health care bill.

The amendment would have expanded Medicaid to South Dakotans earning up to 133 percent of the federal poverty line — $15,521 for an individual or $31,721 for a family of four.

Under the Affordable Care Act, the federal government would pay for 90 percent or more of the cost of the Medicaid expansion. That means South Dakota would pay just a few million dollars right away for some $200 million in federal aid, though the state’s share would rise above $30 million by 2020.

Democrats said that tradeoff is something lawmakers should not refuse. They cited a study saying that infusion of federal dollars would boost South Dakota’s economy, leading to millions of dollars in extra tax revenue.

Republicans split into two camps. Some opposed any possibility of Medicaid expansion, saying the deficit-spending federal government can’t afford new obligations.

Other Republicans said they are open to Medicaid expansion, but only if South Dakota receives flexibility from the federal government to design its own expansion. That is Gov. Dennis Daugaard’s position, too.

The expansion proposal failed 50-19. Every Democrat and two Republicans — Reps. Dean Wink of Howes and Kyle Schoenfish of Scotland — voted for it.

After the Medicaid vote, lawmakers also rejected the original bill, a proposal by Rep. Scott Munsterman, R-Brookings, to create a state-funded health care plan for certain low-income workers on the condition that they work full time.

Munsterman acknowledged the plan, which would have covered an estimated 4,000 people for $14 million annually, is a less efficient use of state dollars than Medicaid expansion because the federal government wouldn’t pay for any of it. But Munsterman said it would be worthwhile because South Dakota would have control over the program.

Democrats also largely backed the bill, even though they prefer Medicaid expansion.

But with Daugaard opposed to creating a state-run health program alongside Medicaid, only 24 legislators voted for the program, while 45 voted no. It needed 47 yes votes to pass.

That plan failed even though Munsterman removed a controversial component of the proposal — stripping nonprofit hospitals of their tax exemption.

Munsterman said that idea, while interesting, distracts from the core purpose of the bill.